Grants 4

4. Helping Hand Ltd decided to participate in the government's drive towards the alleviation of unemployment in the rural areas. The government agreed to subsidise 15 employees' total cost of employment for a four-year period. Helping Hand Ltd employed 15 persons on 1 January 2018 at a total annual cost of P450 000. It is expected that their total remuneration cost will increase at 7.5% per year. A grant received from government on 1 January 2018 for the four year period amounted to P2 mil. REQUIRED: Prepare the journal entries for each of the four-year ended 31 December to account for the above information in accordance with the requirement s of IAS 20 assuming that the grant is deducted from related expenses in the statement of comprehensive income